In our regular Q&A, David Smith, VAT adviser at Croner Taxwise, considers whether VAT can be reclaimed on purchases of electric cars
I have been advised by my dealership and accountant that I can reclaim VAT on the purchase of a new electric car. Is this correct as this would be a major consideration in the decision to purchase?
This has become a very common question of late, presumably driven by the need to become greener and the personal tax benefits available for purchasing a new electric car.
Under current law, an electric vehicle will still be viewed as a car for VAT purposes and is therefore treated in the same as you would a diesel, petrol or hybrid car.
Therefore, if there is any private use of the car, or it is made available for private use, VAT is not recoverable on the purchase.
